No matter what the headlines and news feeds say, as Realtors we always have to maintain a global, national and local understanding of what the numbers say. Recently I've been looking at Condo Townhomes in Whitby between the same month, September, of 2008 vs 2006 and they're really quite interesting. The reason I'm looking at 2006 instead of 2007 is that '07 was an abnormal year in sales volume so 2006 is more typical in terms of volumes and price.

Here's what the numbers say between the two months of September 2006 and 2008 for Condominium Townhomes in Whiby:

  • Prices increased 13.39%
  • Inventory increased 32%
  • Number of Sales to number of Active Listings decreased 20%
  • Total Sales Volume decreased 35%

The chart below shows prices in 2006. E15 represents the Town of Whitby

 

The chart below represents prices for the same period, September 2008. E15 Represents Whitby.

 

 The price increase is interesting because everyone is saying prices are decreasing and in general, they are up and down. However, for this particular product in this particular town there has been no pull-back in price. See how local/yocal it gets?

The real story is in the rest of the numbers. Higher inventory, less homes selling in relation to the amount of inventory and total sales volume down dramatically. This would lead you to think that prices will (or should) drop but not necessarily. It always boils down to what the seller is willing to accept and what the buyer is willing to pay.

Unlike many Sellers in the U.S., most Canadian sellers are not selling out of duress. Home prices experienced gradual yearly increases of approximately 6% per year, not 30 or 40% like some areas of the hard hit U.S. As the politicians and bankers have been saying and for once, it's true... there are fundamental differences between the Canadian and U.S. markets.

I prefer to look at year-to-date numbers as opposed to a single month since a monthly snapshot can be quite skewed. Overall year to date price comparisons of all homes in Whitby in 2006 to 2008 shows a 6% increase in prices overall. This percentage would be the better one to use if pricing a home, especially considering the other negative numbers (i.e. sales volume, inventory etc.) quoted above.

For all of you sitting on the sidelines or currently renting, do you still think it's worth waiting to purchase? 13.3% increase over two years is pretty good. Not that you would realize that gain if you sold now but real estate is not a two year profit vehicle unless it's a booming market. If you buy now, by the time the market starts to pick up, say in two or three years, you'll be so much further ahead than if you were to continue renting.

Feel free to add your 2 cents worth...that helps the discussion.